Contra

Earned ct Review
Value
Report
Projec
t/
Tasks

Totals

Successfully

for Pro
ject

Oct obe

Summa
ry

2002
Nov em
ber

Task 1

Decem

Task 1-A

Presenting
Earned Value

Progra
m Revie
w
ber

Budget

Task 1-B

Task 2

Budget

Spendin

$4,000.0
0
$3,000.0
0
$2,000.0
0
$1,000.0
0
$0.00

$321.74

$200.00
$483.33

t/
Projec
Tasks

March

Ap

May

$109.29

Bu

BCWP
ACWP
Value
ing E
BCWS Spend

dge t

$300

.00
$2, 500

.00
$2, 000

Task 2
Task 3
Task 4

BCWP

.00
$1, 500
BCWS
ACWP

$400

.00
$1, 000

$350

0
$500.0

Task 5

$456

$725

$550

$189
$159
$107

$0. 00
BCWS
BCWP
t
Budge
ACWP

Sum mar

$140

$175

$128

$250

$200
$100
$200

$564
$211
$223
$168

$150

Incomple

Earned Value Management (EVM) is a project management system that combines

schedule performance and cost performance to answer the question, What did we get for
the money we spent?
Basic concepts of EVM:
All project steps earn value as work is completed.
The Earned Value (EV) can then be compared to actual costs and planned costs to
determine project performance and predict future performance trends.
Physical progress is measured in dollars, so schedule performance and cost
performance can be analyzed in the same terms.

Earned Value has been used since the 1960s by the Department of Defense as a central
part of the C/SCSC (Cost/Schedule Control Systems Criteria). Recently, the DOD
revised the 35 criteria contained in the C/SCSC and produced the 32 criteria for EVMS
(Earned Value Management Systems).

$61

30. 6%

Review

CPI abo
te Task

d Task

These criteria have since been accepted by the American National Standards Institute/
Electronic Industry Association as a new standard, called ANSI/EIA 748. Now, EVM
is being used in a wider variety of government contracts, and is spreading through the
private sector as a valuable tool for project managers.

63. 6%

$64

ve 1.3

1.24

2.82

$364

$22

Program
Stat us

Com plete

52. 6%

1.09

0.80

($35)

$108

77. 8%

1.00

1.00

$0

$12

55. 8%

1.00

0.86

($50)

$0

100.0%

$400

$400

$400

$400

Task 1

$350

$300

1.15

1.27

$431

$0

100.0%

$300

SPI

CPI

CV

$267

67. 4%

What is Earned Value

Management?

48.6%
69.7%

CMPLT

$2, 005

$1, 575

$1, 740

$2, 975

.00
$3, 000

ABC
Project

Task 7

66.7%

$100.00

Contrac
ts review:
11-30-02
Sign Off:
______
______ SV
_____
PRCNT

Total
t
Budge

74.4%
64.4%

$200.00
$243.94

Review
mance
2002
Perfor
ril

80.4%

$186.05
$836.56

$225.00
$350.00

78.6%

$500.00

$725.00

Task 6

Your guide to Earned Value Management

$235.71

$175.00

$1,300.0
0

Value

78.3%

$200.00
$350.00

$250.00

Task 2-B

64.2%

$743.50

$400.00

Task 2-C

PRCNT
CMPLT

$2,585.6
2

$725.00

$300.00

Task 2-A

Status

BCW
Ear ned P
Value

$1,375.0
0

$950.00

Task 1-C

Ear ned

ACWP
Spe ndi
ng

$4,025.0
0

$111
$23
$18

1.12

2.11
1.12
1.12

1.40
1.57

CPI from
1 to 1.3
w1
CPI belo

Successfully

Presenting Earned Value

page 2

What are the benets of using

Earned Value Management?
In a typical spend plan analysis, physical progress is not taken into account when
analyzing cost performance. Instead, a projects actual costs to date are simply compared
to planned costs, often with misleading results.
March

Example:

April

May
$3,000.00

Budget-at-Completion

A task has a planned value (PV) of $1000,

and actual costs (AC) of $1000. It appears
this task has perfect cost performance, and is
in good shape to nish on-budget (Figure 1).
However, if physical progress is taken into
account, the results may differ.

$2,500.00

$2,000.00

$1,500.00

Planned
Value = $1000

$1,000.00

Actual
Costs = $1000

$500.00

2002
March

April

May

$0.00

$3,000.00

Budget
AC
$2,500.00

Actual
Costs = $1000
Planned
Value = $1000

$2,000.00

Figure 1

$1,500.00

$1,000.00

Earned
Value = $750

$500.00

$0.00
EV
Budget
AC

In Figure 2, the project has spent $1000

in actual costs but has only achieved $750
of Earned Value.
This is called a cost overrun, and this
project would have a Cost Variance (CV)
of -$250.

Figure 2

From this example, we can see that EVM expands on the two-dimensional analysis
Has this project spent more or less money than planned? by adding the third
dimension What did we get for the money we spent?

Successfully

Presenting Earned Value

page 3

Building Blocks of
Earned Value Analysis
In addition to more accurate project status assessment, EVM makes it easy for a project
manager to analyze both schedule and cost performance in a variety of ways. Using a
limited set of basic task information, it is possible not only to determine how a project
has been performing, but to predict future performance trends as well.
Basis for Earned Value Analysis:

Budget at Completion (BAC) = Overall approved budget for a task.

Actual Costs (AC) = Total amount spent on a task up to the current date.
Percent Complete = Task progress, related as either EV/BAC, or simply physical
progress shown by the ll of the task bar.

Contract Review
Earned Value Report
Project /
Tasks
Totals for Project

2002
October

November

BAC

AC

December

%
Complete

$4,025.0

$1,375.00

63.7%

$950.0

$725.00

78.3%

Task 1-A

$300.0

$200.00

78.6%

Task 1-B

$400.0

$350.00

80.4%

Task 1-C

$250.0

$175.00

74.4%

Task 1

$4,000.00

Once these three measurements have been established, the following calculations can be
performed:

Earned Value (EV) = BAC x Percent Complete. The budgeted cost of completed
work as of the current date.
Planned Value (PV) = The point along the time-phased budget that crosses the
current date. Shows the budgeted cost of scheduled work as of the current date.

Presenting Earned Value

Successfully

page 4

Building Blocks of
Earned Value Analysis
Project /
Tasks

October

November

December

Actual Earned Planned

Value
Costs Value

BAC

64%

$4,025

$1,375

$2,564

$2,780

78%

$950

$725

$743

$783

Task 1-A

79%

$300

$200

$236

$246

Task 1-B

80%

$400

$350

$322

$339

Task 1-C

74%

$250

$175

$186

$198

10

Totals for Project

Task 1

11

12

13

14

View detailed EVM data in

actual dollars as part of a
presentation schedule...
October

November

December
$4,000.00

BAC

DATE
LINE

$3,500.00

$3,000.00

PV
$2,500.00

EV

$2,000.00

$1,500.00

$1,000.00

AC
$500.00

$0.00
Earned Value
Budget
Actual Costs
Planned Value

Summary

Program Review

Status

...or use an easy-to-read

DataGraph for at-a-glance
visual analysis of project
trends.

Successfully

Presenting Earned Value

page 5

Performance Indices
and Variance
Once Earned Value and Planned Value are known, they can then be used to determine
schedule and cost variance, and calculate performance efciency.

October

Schedule Variance (SV) = Earned Value Planned Value. The difference

between what was planned to be completed and what has actually been completed
as of the current date.
Cost Variance (CV) = Earned Value Actual Costs. The difference between
the work that has been accomplished (in dollars) and how much was spent to
accomplish it.
November

December

January

$3,500.00

$3,000.00

Schedule
Variance (SV)

$2,500.00

$2,000.00

Cost
Variance (CV)

$1,500.00

$1,000.00

$500.00

$0.00
Planned Value
Earned Value
BAC
Actual Costs

Figure 6

In Figure 6, the project shown

has a negative SV, because it
has earned less value than was
planned, as of the current date.
However, it has a positive CV,
because the Earned Value is greater
than the Actual Costs accrued.

Successfully

Presenting Earned Value

page 6

Performance Indices
and Variance

Schedule Performance Index (SPI) = Earned Value / Planned Value. Schedule

variance related as a ratio instead of a dollar amount. A ratio less than 1 indicates
that work is being completed slower than planned.
Cost Performance Index (CPI) = Earned Value / Actual Costs. Cost variance
related as a ratio instead of a dollar amount. A ratio less than 1 indicates that the
value of the work that has been accomplished is less than the amount of money
spent.

Performance Review
Tasks

2004

BAC
March

April

May

Earned Planned Actual

Value
Value Costs

CPI

SPI

Project A

$850

$270

$335

$250

1.08

0.81

Task 1

$350

$195

$260

$150

1.30

0.75

Task 2

$500

$75

$75

$100

0.75

1.00

Figure 7

In Figure 7, Project A has a CPI greater than 1.00. This shows

us that the project has been earning value faster than it has been
accruing costs.
However, Project A also has a SPI value that is less than 1.00.
Although Actual Costs are low, Task 1 is behind schedule,
so the project has not earned as much value as was planned.

Successfully

Presenting Earned Value

page 7

Forecasting Future
Performance Trends
The Schedule Performance and Cost Performance Indices not only monitor current
project performance, they can also be used to predict future performance trends.
To-Complete Performance Index (TCPI) = (BAC-EV) / (BAC-AC).
Indicates the CPI required throughout the remainder of the project to stay within
the stated budget.
Estimate at Completion (EAC) = AC + ((BAC-EV)/CPI). A forecast of total
costs that will be accrued by project completion based on past cost performance
trends.
Variance at Completion (VAC) = EAC BAC. The difference between the new
Estimate at Completion and the original Budget at Completion.

Performance Review
Tasks

BAC

EAC

2004

VAC
March

Project A

$2,975.0

2,355.70

-619.30

Task 1

$300.0

350.00

50.00

Task 2

$400.0

440.00

40.00

April

AC

EV

TCPI

CPI

May
$3,000.00

$1,615.00

$2,004.73

0.71

1.24

$350.00

$300.00

0.00

0.86

$440.00

$400.00

0.00

0.91

$175.00

$139.53

1.47

0.80

$200.00

$563.89

0.31

2.82

$1,000.00

$100.00

$210.53

0.63

2.11

$500.00

$200.00

$222.73

0.85

1.11

$150.00

$168.06

0.95

1.12

$2,500.00

$2,000.00

Task 3

$250.0

313.09

63.09
$1,500.00

Task 4

$725.0

257.13

-467.87

Task 5

$400.0

189.80

-210.20

Task 6

$350.0

314.66

-35.34

Task 7

$550.0

491.02

-58.98
$0.00

Planned Value
Earned Value
Budget
Actual Costs

Successfully

Presenting Earned Value

page 8

How do I get started using

Earned Value Management?
Identify and Organize all Project Steps
First, identify all tasks that need to be accomplished and organize the tasks into subgroups (1). Breaking down activities into the smallest possible steps makes it easier to
pinpoint schedule and cost performance problems.
2004

Tasks
March

Project A

April

May

3/10

5/8

Total
Budget
$2,975.0

Task 1

$300.0

Task 2

$400.0

Task 3

(2)

(1)

$250.0

Task 4

$725.0

Task 5

$400.0

(3)

Task 6

Task 7

$350.0

$550.0

Status

Incomplete Task

Completed Task

Started Task

Allocate the Budget and Schedule the Tasks

Each activity in the project should have a planned Budget-at-Completion (BAC). All
subsequent earned value calculations will be based on this amount (2). In addition to
the BAC, each task should also have a specic duration (3), which provides the basis for
monitoring actual costs and physical progress.

Successfully

Presenting Earned Value

page 9

How do I get started using

Earned Value Management?
Update Task Status and Enter Actual Costs
As the project progresses, the percent complete for unnished tasks should be updated
and monitored (4). Earned Value (EV) is determined by relating this physical progress
to the BAC. Along with task status and budget, it is necessary to maintain actual costs
accrued for each task in order to calculate cost performance (5).

Tasks
Project A

%
Comp.

2004
March

April

59% 3/10

May
5/8

Total
Budget

AC

$2,975.00

$1,575.00

(5)

Task 1

100%

$300.00

$350.00

Task 2

100%

$400.00

$400.00

Task 3

51%

$250.00

$175.00

Task 4

78%

$725.00

$200.00

Task 5

47%

$400.00

$100.00

Task 6

73%

$350.00

$200.00

Task 7

14%

$550.00

$150.00

(4)

Status

Incomplete Task

Completed Task

Started Task

Successfully

Presenting Earned Value

page 10

How do I get started using

Earned Value Management?
Use the Data to Make Informed Decisions
Now that all tasks have been scheduled, and the BAC, EV, Percent Complete, and AC
are known, further analysis can be performed, including schedule and cost variances,
performance efciency, and estimates-at-completion.

Earned Value Report

Project /
Tasks

2004
October

Totals for Project

Task 1
Task 1-A
Task 1-B
Task 1-C
Task 2
2002
Task 2-A
Task 2-B
April
May
Task 2-C
5/9
Task 3
Task 3-A
Task 3-B
Task 3-C

December

Earned Value and Performance Review

Project/
Tasks

March

Project ABC

3/11

Task 1

Total
Budget
$2,975.0
$300.0

ACWP
Spending

BCWS
$1,739.90
$300.00

Contract Review

Task 2

Earned Value

Task 3

Budget

Task 4
Spending

$400.0

$350.00

$400.00

$400.00

$127.91

$175.00
October

BCWP
E Value

$4,025.0

$2,585.62

$950.0
$300.0

$743.50
$235.71

$400.0

$321.74

$250.0
$1,300.0

$186.05
$836.56

$725.0
SV
$225.0

PRCNT
CMPLT

$483.33
CV
CPI
$109.29

$350.0
67.4%$1,775.0
$264.85

$243.94
$429.74
$1,005.56 1.27

$550.0
$300.00 Final 100.0%
$0.00
$800.0
Review
$425.0
$400.00
100.0%
$0.00

$358.14
($50.00)
0.86
$480.00
$167.42
$0.00
1.00

$2,004.73

Project /
$3,000.00
$250.0
Tasks

$139.53

SPI
1.15
1.00
1.00

2004
55.8%
$11.62 ($35.47)
0.80
November
December

$1,500.00

Totals for Project

$725.0

1.09

$4,000.00

$456.48

$200.00

$563.89

77.8%

$107.41

$363.89

2.82

$189.47

$100.00

$210.53

52.6%

$21.06

$110.53

2.11 $3,500.00
1.11

1.24

$400.0

Summary
Task 1-A
Task 6

Program Review
$350.0

$159.09

$200.00

$222.73

Status
63.6%

$63.64

$22.73

1.11

Task 1-B

Task 7

$3,000.00

$550.0
$3,000.00
$2,000.00
$1,000.00
$0.00

Schedule Variance $500.00

Cost Variance
$350.00
$200.00
$50.00
($100.00)

AC

EV

$4,025.0

$1,375.00

$2,563.59

63.7%

$950.0

$725.00

$743.50

78.3%

$300.0

$200.00

$235.71

78.6%

$400.0

$350.00

$321.74

80.4%
74.4%

1.40

$106.94

$150.00

$168.06

30.6%

$61.12

$18.06

1.12

1.57

Task 1-C
PV
EV
BAC
AC

BAC

$0.00

Task 1

Task 5

$1,575.00

Earned
Value

Budget

November

$250.0

$175.00

$186.05

$1,300.0

$500.00

$836.56

64.4%

$725.0

$200.00

$483.33

66.7%

$225.0

$100.00

$109.29

48.6%

$350.0

$200.00

$243.94

69.7%

$1,775.0

$150.00

$983.53

55.4%

$550.0

$150.00

$358.14

65.1%

$800.0

$0.00

$480.00

60.0%

$0.00

$145.39

34.2%

$2,500.00

Task 2

Summary

Status

Task 2-A
Task 2-B

$2,000.00

Completed Task

CPI above 1.3

$1,500.00

Task 2-C

Incomplete Task

CPI from 1 to 1.3

Program Review

CPI below 1

Task 3
Task 3-A

$1,000.00

$500.00

Task 3-B

Final
Review

Task 3-C
Earned Value
Budget
Spending

$0.00

$425.0

Contracts review: 11-30-01

Summary

Program Review

Status

Sign Off: _________________

Successfully

Presenting Earned Value

page 11

Example Reports and

Resources
On the following pages, several example Earned Value reports are shown. These
examples, as well as the charts on the previous pages, were created in Milestones
Professional 2004. Visit KIDASA.com to view these examples and more, or to
download a trial version of Milestones Professional.

Earned Value = Budget x % Complete

Planned Value = Total Budget x % duration to the current date

Earned Value Calculations

Project/
Tasks

2005
March

Project ABC

BAC

April

May

PRCNT
CMPLT

$1,809

$1,575.0

$2,005

67.4%

Budget $2,500.00

$300

$300

$350.0

$300

100.0%

$2,000.00

$400

$400

$400.0

$400

100.0%

$1,500.00

$250

$134

$175.0

$140

55.8%

$1,000.00

$725

$483

$200.0

$564

77.8%

$400

$200

$100.0

$211

52.6%

$350

$170

$200.0

$223

63.6%

PV

Task 3
AC
Spending

Task 4

Earned
Value

$2,975

Task 2
Earned Value

Actual
Costs

5/8 $3,000.00

3/10

Task 1

Planned
Value

Task 5

$500.00

Task 6

$0.00
PV
EV
BAC
AC

Status

Incomplete Task

Completed Task

Started Task

Successfully

Presenting Earned Value

Earned Value and Performance Review

Project/
Tasks

2005

Schedule Variance = EV - PV
Cost Performance Index = EV / AC

May

Total
Budget

5/8

$2,975.00

Task 1
Task 2

Cost Variance = EV - AC
Schedule Performance Index = EV / PV

Actual
Costs

Earned
Value

$1,808.97

$1,575.00

$2,004.73

67.4%

$195.77

$429.74

1.27

1.11

$300.00

$300.00

$350.00

$300.00

100.0%

$0.00

($50.00)

0.86

1.00

$400.00

$400.00

$400.00

$400.00

100.0%

$0.00

$0.00

1.00

1.00

Task 3

$250.00

$133.72

$175.00

$139.53

55.8%

$5.81

($35.47)

0.80

1.04

Task 4

$725.00

$483.33

$200.00

$563.89

77.8%

$80.56

$363.89

2.82

1.17

Task 5

$400.00

$200.00

$100.00

$210.53

52.6%

$10.53

$110.53

2.11

1.05

Task 6

$350.00

$169.70

$200.00

$222.73

63.6%

$53.03

$22.73

1.11

1.31

$550.00

$122.22

$150.00

$168.06

30.6%

$45.84

$18.06

1.12

1.38

March

Project ABC

April

3/10

Task 7
PV
EV
BAC
AC

Planned
Value

page 12

PRCNT
CMPLT

SV

CV

CPI

SPI

$3,000.00

Summary

Status

Completed Task

CPI above 1.3

Incomplete Task

CPI from 1 to 1.3

Program Review

CPI below 1

$2,000.00
$1,000.00
$0.00

SV
CV

$500.00
$350.00
$200.00
$50.00
($100.00)

Contract Review

Summary

Earned Value Report

Project /
Tasks

Program Review

2005
October

November

Budget
December

Totals for Project

Actual
Costs

Status
Earned
Value

PRCNT
CMPLT

$4,025.00

$1,375.00

$2,585.62

64.2%

$950.00

$725.00

$743.50

78.3%

Task 1-A

$300.00

$200.00

$235.71

78.6%

Task 1-B

$400.00

$350.00

$321.74

80.4%

Task 1-C

$250.00

$175.00

$186.05

74.4%

$1,300.00

$500.00

$836.56

64.4%

Task 2-A

$725.00

$200.00

$483.33

66.7%

Task 2-B

$225.00

$100.00

$109.29

48.6%

Task 2-C

$350.00

$200.00

$243.94

69.7%

$1,775.00

$150.00

$1,005.56

56.7%

$550.00

$150.00

$358.14

65.1%

$800.00

$0.00

$480.00

60.0%

$425.00

$0.00

$167.42

39.4%

Task 1

Task 2

Task 3
Task 3-A
Task 3-B

Final
Review

Task 3-C
Earned Value
Budget
Spending

$4,000.00
$3,000.00
$2,000.00
$1,000.00
$0.00

Contracts review: 11-30-02

Sign Off: _________________

Successfully

Presenting Earned Value

Schedule Variance = EV - PV
Cost Performance Index = EV / AC

Performance Review
Project/
Tasks

2005
March

April

Total
Budget

May
$3,000.00

Project ABC

Budget
$2,500.00

Task 1

Task 2

Planned
Value

page 13

Cost Variance = EV - AC
Schedule Performance Index = EV / PV

Actual
Costs

Earned
Value

PRCNT
CMPLT

SV

CV

CPI

SPI

$2,975.0

$1,808.97

$1,575.00

$2,004.73

67.4%

$195.77

$429.74

1.27

1.11

$300.0

$300.00

$350.00

$300.00

100.0%

$0.00

($50.00)

0.86

1.00

$400.0

$400.00

$400.00

$400.00

100.0%

$0.00

$0.00

1.00

1.00

$250.0

$133.72

$175.00

$139.53

55.8%

$5.81

($35.47)

0.80

1.04

$725.0

$483.33

$200.00

$563.89

77.8%

$80.56

$363.89

2.82

1.17

$400.0

$200.00

$100.00

$210.53

52.6%

$10.53

$110.53

2.11

1.05

$350.0

$169.70

$200.00

$222.73

63.6%

$53.03

$22.73

1.11

1.31

$550.0

$122.22

$150.00

$168.06

30.6%

$45.84

$18.06

1.12

1.38

$2,000.00

Earned Value

Task 3
Planned Value
$1,500.00

Task 4
Actual Cost
$1,000.00

Task 5

Task 6

$500.00

Task 7
$0.00
PV
EV
BAC
AC

Summary

Status

Program Review

CPI from 1 to 1.3

Completed Task

Incomplete Task

CPI above 1.3

CPI below 1

Materials for further Earned Value Management research:

Fleming, Q., & Koppelman, J. (2000). Earned Value Project Management. 2nd Ed.
Pennsylvania: Project Management Institute.
Lewis, J. (2000). The Project Managers Desk Reference. New York: McGraw-Hill.
Portny, S. (2001). Project Management for Dummies. New York: Hungry Minds, Inc.
KIDASA.com - Home of KIDASA Software, Inc., makers of Milestones Professional.
EarnedValueManagement.com - All about Earned Value. Denitions, examples, and more.
PMI.org - Home of the Project Management Institute, and a variety of PM resources.

Copyright 2005 KIDASA Software, Inc. All rights reserved. www.kidasa.com. This publication may be distributed freely, as long as it is distributed in its entirety.